In episode 15 of the Crowd we connect with Robin Alter, CEO of Swapdom. Robin discusses how with the sharing economy site Swapdom you can "pay" with what you give away.
For more information on Swapdom: http://www.swapdom.com/
In episode 15 of the Crowd we connect with Robin Alter, CEO of Swapdom. Robin discusses how with the sharing economy site Swapdom you can "pay" with what you give away.
For more information on Swapdom: http://www.swapdom.com/
In episode 15 of the Crowd we connect with Robin Alter, CEO of Swapdom. Robin discusses how with the sharing economy site Swapdom you can "pay" with what you give away.
For more information on Swapdom: http://www.swapdom.com/
Transcript:
Kevin: This episode of The Crowd is brought to you by Near Me, everything you need to power your marketplace.
Hi. Welcome to The Crowd, a podcast by Near Me. We’re talking about peer-to-peer marketplaces. We’re talking about collaborative economy and we’re talking about thought leadership. We’re talking about all these things, any and all of them with some of the best minds in the field. And of course, I’m your host, Kevin Cohen.
I’m super excited about today’s interview. I’ll be joined by Robin Alter. Robin is the CEO of Swapdom and SwapGaming. Robin, welcome to the show.
Robin: Thank you very much. Thanks for having me.
Kevin: Of course, of course. But we’re going to jump in to what Swapdom and SwapGaming are. But before we do that, let’s jump in to some rapid fire questions. What book do you recommend most often to your friends and teammates?
Robin: I read a lot. Lately, I’ve been reading The Mesh by Lisa Gansky. So I think that’s probably the one that’s foremost on my mind right now.
Kevin: Where do you spend most of your time online on a personal basis?
Robin: On a personal basis. I guess I’m spending a lot on Twitter just reading all the different feeds. I subscribe to a lot of people.
Kevin: Who do you like to follow online? Who are some of the influencers that you follow?
Robin: Esther Dyson, Lisa Gansky, Arun, the New York University professor on the sharing economy, Google Ventures.
Kevin: What peer-to-peer marketplaces do you like to use?
Robin: I use Lyft a lot, of course Etsy, Airbnb.
Kevin: Very cool. Okay. Let’s jump in to the world of Swapdom. What did you do before you did Swapdom? What kind of led up to the Swapdom days.
Robin: So I had been in the gaming industry for about 15 years. I was living in India for about eight years where I started one of the first online game polishers there. So I really learned about that emerging market and doing business across Asia. When I moved back to the US, I hail from New York but I came back recently and relocated to San Francisco and I joined up with Swapdom. So what Swapdom has was just – I had been working in community and peer to peer and social gamin for a long time. And when I was introduced to Swapdom, I was amazed at the technology and what it could do.
Kevin: Very cool, very cool. Tell us the story behind Swapdom. How did it get started? Where did the idea come from? Give us the backstory.
Robin: Sure. So about three years ago, two brothers in Greece, Petros and George Georgopoulos, they have been working for the last 25 years writing algorithms to optimize different systems. And three years ago, they came up with a new algorithm to optimize bargain or swapping. And what this does their technology enables us to exponentially increase the number of closed trades in any barter market which is the super powerful proposition. Bartering is never actually scaled to any degree. It’s been very much limited to villages and to small organizations. And then there are different solutions to enable on a slightly larger level but fundamentally it’s difficult to find somebody who wants the thing you want to get rid of and they have something that you want. And that’s the problem we address.
By enabling everyone just to click on anything they like and offer any of this other stuff they want, our algorithms will automatically find and recommend swaps for them, for everyone in the community. What we do is we actually create multi-party swaps. So you don’t have to know who you’re swapping with. You don’t have to negotiate. You don’t have to look for reciprocity in a deal. Just by saying what you want and what you’re willing to give up, the algorithms will create swap loops. What I think is one of the most interesting examples of a multi-party swap is two years ago the Nobel Prize for Economics was awarded to two game theorists for multi-party swap algorithm implemented in the kidney exchange industry. If you need a kidney, it’s hard to find a kidney. You can’t buy one. You get on a long waiting list. But what they were able to do is to enable a multi-party software. Everyone will say, “Hey, I need this kidney with this kind of specs. And my brother is willing to offer his kidney in return as long as I get one.” And they were able to save over 50,000 lives in a year by creating, by enabling an environment where one person gives their kidney to another person who gives to C, who gives to D and back to me who I get my kidney when I need it.
Kevin: So it’s like there is actually a lot of applications for this technology. Have you guys thought of other applications beyond just the direct swap? I mean there are a lot of niches where this algorithm could have use.
Robin: Yes. So that’s been the thing I’m focused on. It’s like we started with physical goods. We started to apply this in swapdom.com where people can come and swap anything. And then we looked at other markets such as virtual goods. So now, we’re integrated in doing, letting players of different games swap swords for magic wands, for armor with no money, just to be able to exchange without having to you know – the characteristics in games that they’re often very rude and obnoxious to each other. So by removing that problem, by removing any negotiation, they can now get exchanges of items very quickly and efficiently and no friction with delivery because we just automatically do the exchanges through the games. So we are looking at other markets. We’re talking to people in social housing. There’s a really nice application to use this in Forex and in bit coins. Someone approached us recently about looking at energy swaps. So I’m open and excited to talk to anyone who has an idea. We solved a specific problem and can apply this technology to almost any market that I can think of.
Kevin: Very, very cool. So as a CEO of Swapdom, what do you do on a daily basis? Paint that picture for us.
Robin: So at the moment, I’ve been dividing my time between making sure that our most recent product, SwapGaming, is doing well – and we launched about six weeks ago and we’ve gotten over 35,000 users so far. And so, it’s growing pretty quickly. And now, I’m looking at we’re going to add more games and make sure that – and build up the team and hire more and just make sure that product stabilizes and people start to look at it as “wow, this is a way to really enable a safer, faster, more efficient exchange environment for any game.” So that’s part of my role. The second part is I’m doing sort of BD where I’m talking with different companies about the application of the technology. And then third, I will start to do fundraising rounds in February based upon the traction we’ve gotten.
Kevin: Very cool. So how has the company been funded to date?
Robin: So we received Series A out of a European fund that was set up to help Greek entrepreneurs. Most of our team is still in Greece and I’m out here in San Francisco building the team here.
Kevin: Great. Is it hard having an on-shore and off-shore hybrid model?
Robin: Considering I’ve been doing that for 10 years building on-shore, off-shore companies, no, I think it’s actually a huge benefit. Our technology group is basically in Greece. But out here from biz dev, from customer support, marketing, we’re doing out of San Francisco. So it’s a way to get the best of both worlds and I think any company should be, all companies should be looking at ways to optimize our cost structure in order to grow faster economically.
Kevin: Tell us what went well for you guys in 2014.
Robin: Well, we made a complete shift. So after having looked at what the difficulties in just the physical goods market are and there are a lot of players who’ve tried it and I still think it’s a struggle to get, to deal with the friction in physical goods swapping, we transitioned into focusing on gaming. And that’s done very well as a way to again demonstrate the efficacy of the technology. And I believe that other implementations in other markets will also open up. So it’s been great to launch, to pivot the company, to launch a product, to see that product successful and to really get ready for 2015.
Kevin: Very cool. What were some of the challenges that you guys faced?
Robin: There’s a couple. First of all, the physical goods exchange model is filled with a lot of friction. People still have to box things up, clean them up and ship them to others. Even when we subsidized shipping, it’s a bit of work. And so where that’s being more successful is in markets where there are very high end items to be swapped or in places where there’s a deeper cause such as helping orphanages get clothing or mothers from low income houses to get prams for their babies and different types of – so when the market for swapping is very tight or on a community of interest or the economics makes sense where you’re getting great enough value, then it makes sense. So far, getting enough traction from hey, we do any kind of swapping for any type of item has been slower. So that’s been a challenge.
The other big challenge in my mind is that I believe that the entire sharing economy is largely about renting. It’s largely – it’s not addressing what I think will be the bigger market which is around bartering. When you look at the massive internet sites out there, they’re really addressing the top ten percent of people that actually have money to spend. But having worked in emerging markets and having known that people still – yeah, I can go down to goodwill and buy something for cheaper but that money is still not being used for my kids’ education or for other things. So I believe that bartering will emerge as a much stronger force as a way for people to shop without money. Our society creates so much, so many things that get, most of it, 80 percent gets thrown into waste dumps somewhere. So if we can get better at leveraging this type of model, this shopping without cash or bartering for things, we will actually help the planet and actually create a lot more value for people across the supply chain, across countries and demographics.
Kevin: I mean it sure makes sense from a sustainability standpoint. What concerns me about the bartering model is not that it isn’t needed or it won’t work. It’s that I think state and local governments and federal government are going to have a hard time supporting it because there are no transactions happening and there are no tax revenues being generated. So it’s interesting from a policy standpoint.
Robin: First of all, I think some of the bigger players like Uber and Lyft, they are dealing with probably a more difficult legal battle because they are going up against established businesses who have revenue models attached to it. And they’re kind of redefining the way business can be done. So that’s a more difficult legal challenge. But there are plenty of governments and plenty of governments in different cities that are looking at ways to help people on a broader scale with less money. And yeah, there will be a time [taxing] point. I think that’s [part] of the things to worry about. There’s a greater good. There are ways to create revenue models if that’s required. I’m not so worried about the legal battles now. I think there are bigger things happening and the benefit will far outweigh the negatives.
Kevin: So in terms of challenges that you face in 2014, why don’t you go deeper into that? What are some of your challenges? And how did you overcome them?
Robin: So first of all, the challenge of getting people to look at bartering in a different way. I mean, right now how it’s done – and to look at it as a way to really maximize value in any transaction. That’s still a challenge. I’m still out there trying to get a different message out there and that remains a challenge that I will continue to go and talk about. There are certainly other means of creating bartering environments like with virtual coins. But then, there are other issues that come into any economy like that like inflation, like the feeling of loss that consumers may feel. So a value for value exchange based upon a subjective measurement that users bring I think is going to be an important and desirable thing. So that’s one challenge. I think I’ve talked about that a bit.
The challenge of getting a product out there that demonstrates why this is unique and important was challenging. I think with gaming... Oddly enough, gaming is not even in anyone’s scope of the sharing economy although trading and sharing have been fundamental to those kinds of products for years. So for some reason, it’s considered a different entity but I think it’s a wonderful view into what actually sharing and collaborating and bartering and trading happens in the real world. So the challenge there is to continue to make that product grow and to grow that segment and to find other ways to get other bartering products in other segments going.
Kevin: So in your different entities what are the primary methods of customer acquisition for you guys?
Robin: So currently, I guess, on the gaming side our customer acquisition strategy has been to work with teams. We’ve had great partnerships with some of the professional East sports teams who have liked the product and then they’ve personally just taken on as hey, this is a safe place for more novice players who are not looking to make money off trades but to actually just get the items they want for them to be able to engage in a safe, easy non-threatening environment for items. So that’s been great because we’ve had good partnerships from some of the top professional groups. That’s actually been our entire strategy for user acquisition. It’s working with professional organizations, celebrities, teams. That’s how we’ve done it. Again, it’s early and I think we’ll do more of that.
The next thing is we will add more game play and more engaging kinds of things to do around swapping so that you can get things you want very inexpensively or cheaper or for free. And that hopefully will create an organic environment where people will tell their friends to come on board so that they can also not just swap but also get all these cool stuff. So that’s user acquisition from the gaming side.
From the physical good side, we’ve largely done through bloggers, influencers in the industry. It has not been as successful as I – certainly, it’s a higher acquisition cost than other markets. So we’ve not been focusing on the physical goods side as much.
Kevin: Okay. So what are some of the big objectives that guys have for 2015?
Robin: To certainly get other markets like – I would love to get implantation in the circular economy or in a way that we’re doing a non-profit example of how bartering can help people. We have some really good ideas and we’re looking for partners on that. I would love to certainly get the gaming segment and more games involved to using this technology. And then I also want to open other segments. So there are specific areas in physical goods, potentially services swapping if people could be able to offer an hour of their time say as an accountant to get their house painted or those kinds of other dynamic kind of models. I would love to be able to demonstrate bartering in other scenarios. The fourth one is to raise more funds to do this in a bigger way.
Kevin: Right. Are you primarily looking to raise funds domestically? Are you talking to groups all over the world?
Robin: We’re starting here in the Bay Area.
Kevin: Very good.
Robin: We do have interest in people who have come to us from say India and China to actually do different types of swapping environments there. So it’s been interesting to see how global we’ll go and how quickly.
Kevin: Well, Robin, thanks for joining us here today. For all of our listeners who are listening in on this podcast, where can they find out more about your companies?
Robin: You can check out swapdom.org. And from there, you can check out swapgaming.com or swapdom.com. But swapdom.org is the overriding company to check it all out then.
Kevin: Wonderful. Well, thank you for joining us here today everyone. We hope you got lots of great tidbits from this. Anyway, Robin, thanks. We’re going to sign off now.
Robin: Thanks, Kevin. I appreciate it.
Kevin: So that’s it for today’s show everybody. I’d like to thank Robin Alter for joining us here today. They’re doing great stuff at Swapdom. So check them out. If you want to learn more about them, we’ve got all the show notes at www.near-me.com. Click on the blog and then go to the podcast listing. If you liked today’s show, we’d really appreciate it if you can go to iTunes and leave us a five-star review. It really helps us out. Make it a great day. Thanks.
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